Driving up Telecom

Český Telecom's share price has jumped by 15.2% this year, compared to an overall increase in the PX 50 index of 7.2%. Analyst Jan Schiesser of Atlantik FT said yesterday that with indicative bids for the Telecom privatization due tomorrow, it's highly improbable that an investor will be willing to pay the current stock-market price. Instead, he expects a discount of 14% to the market price. The cabinet is to decide on Feb. 9 whether to continue with a direct sale or switch to a share flotation. A discount of such a magnitude would be a seemingly legitimate excuse to switch. There's speculation, though, that someone is intentionally driving up the share price in order to derail the direct sale. A flotation could make it possible for a small group of investors to take over Telecom. After a few weeks of uncertainty, it again appears that this is the grand plan. [Czech Republic strategic partner M&A finanční trhy]